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<br />0383 <br /> <br />. <br /> <br />. <br /> <br />In February 1981, shortly after he assumed office,. Interior <br />Secretary James Watt was given a briefing on the unresolved <br />audits. BuRec eventually agreed to the allocation of joint <br />costs to the second unit of the Mt. Elbert powerplant in a <br />February 17, 1981 memorandum from Deputy Assistant Secretary <br />for Land and Water Resources David C. Russell to Inspector <br />General Brown. On March 9, 1981 BuRec Commissioner Designate <br />Robert Broadbent and Assistant Commissioner Cliff Barrett met <br />with representatives of the Inspector General's office to <br />discuss the same subject. A March 26, 1981 memorandum from <br />Supervisory Auditor Catherine Burke to the Files documents this <br />meeting. In regard to Fry-Ark, BuRec reported that it was <br />preparing a "briefing for the Secretary which will serve as a <br />decision document." <br /> <br />BuRec sent the decision document, a Secretarial Issue <br />Document (SID), to Secretary Watt on April 27, 1981, along with <br />a memorandum from Commissioner Broadbent. Broadbent presented <br />the argument against the other cost allocation recommendations <br />and stated, "The Inspector General dues not accept this as <br />final resolution of the issues. I recommend that you reaffirm <br />the position that no further adjustments to the Fryingpan <br />Arkansas Project cost ~llocation are necessary..." On June 29, <br />1981 Under Secretary Donald P. Hodel, acting for Secretary <br />>latt, concurred with BuRec's position and signed the SID. Also <br />on that day, BuRec Regional Director Bill E. Martin (Denver, <br />CO) notified Southeastern Colorado Water Conservancy District <br />President Raymond Nixon that water would be delivered under ~he <br />original 1965 repayment contract and that delivery would begin <br />on January 1, 1982. N~wly-appointed Inspector General Richard <br />Mulberry apparently considered the matter finished and dropped <br />the Fry-Ark audit from the listing of unresolved audit findings <br />in the Inspector General's Semi-annual Report (September 1981), <br />though there is no formal notice of his acceptance of the <br />Secretary's decision. <br /> <br />The net results of these differing views on cost allocation <br />are displayed in Table 6-2. <br /> <br />Table 6-2 <br /> <br />FRYINGPAN-ARKANSAS COST ALLOCATIONS (in millions) <br /> <br /> Original Inspector Allocation <br /> BuRec General Agreed to <br /> Allocation Recalculation by BuRec <br />Reimbursable $398 $467 $407 <br />Non-reimbursable 166 102 150.3 <br /> <br />63 <br />